Judge: Stephen P. Pfahler, Case: 19CHCV00473, Date: 2022-10-04 Tentative Ruling

Case Number: 19CHCV00473    Hearing Date: October 4, 2022    Dept: F49

Dept. F-49

Date: 10-4-22

Case #19CHCV00473

Trial Date: 6-27-23 c/f 1-18-22 c/f 9-27-22 c/f 1-19-21 c/f 8-17-20

DEPOSITION

MOVING PARTY: Defendant, Henry D. Paloci, III

RESPONDING PARTY: Unopposed/Plaintiff, Richard Kuehne

RELIEF REQUESTED

Motion to Compel the Deposition of Plaintiff Richard Kuehne

SUMMARY OF ACTION

Plaintiffs Richard Kuehne alleges entry into a Stock Purchase Agreement with Defendants Danny and Jacqueline Rowlett, whereby Plaintiff agreed to purchase all interests, including assets and liabilities, in an entity identified as Alliance Metal Products, Inc. The purchase price was $200,000. The parties also executed a second agreement for the purchase of certain assets valued at $100,000, and represented as the property of Danny Rowlett. The agreements were executed on September 27, 2018.

Plaintiff financed the agreement with the transfer of certain real property valued at $280,000, plus an additional $20,000 payment. The real property is located in Colorado Springs, Colorado. Plaintiff alleges the parties concurrently executed an “option agreement,” which allowed Plaintiff to repurchase the real property in Colorado for $280,000, if payment was made no later than March 27, 2019.

According to Plaintiff, the listed the assets in the property sale agreement was in fact owned by a third party. Defendants also allegedly failed to disclose that certain accounts receivable were “likely uncollectible” and that Danny Rowlett previously executed a “Forbearance Agreement” with third party Bank of the West acknowledging a debt of $281,333.26 to the bank jointly owed by Danny Rowlett and Alliance Metal Products, Inc. The agreement led to a $259,902.02 Confession of Judgment joint and severally entered against Danny Rowlett and Alliance Metal Products, Inc. on December 3, 2018.

The remainder of the complaint alleges two small claims actions also served on Defendants, as well as unpaid taxes and other unspecified outstanding debts. It’s not clear whether the small claims actions resulted in any judgment liability.

Given all the debts addressed above, total liabilities added up to $400,000. According to Plaintiff, the combined debt effectively nullified the option agreement to repurchase the Colorado property.

On June 7, 2019 and October 30, 2019, Plaintiff filed a verified complaint and verified first amended complaint for Breach of Contract, Fraud, Set Aside Fraudulent Transfer, and Injunction and Constructive Trust. On June 12, 2019, Plaintiff filed a Notice of Pendency of Action.

On January 23, 2020, Henry D. Paloci, III, Trustee of Alliance Holding Trust, filed a cross-complaint for interpleader. The interpleader alleges that upon the completion of the sale for Alliance Metal Products, Inc., the parties agreed to place the Colorado property into a trust to be held until March 31, 2019—the expiration of the option agreement.[1] Cross-Complainant contends that the parties dispute ownership of the property prompted the complaint in interpleader.

On August 27, 2020, Bank of the West filed a Notice of Lien based on an action entitled Bank of the West v. Alliance Metal, et al. (18CHCP00076, Dept. 47), which led to the December 3, 2018 $259,902.50 joint and several judgment against Defendant Danny Lee Rowlett and Alliance Metal Products, Inc. referenced above.

On September 15, 2020, the court sustained the unopposed demurrer to the interpleader cross-complaint with leave to amend.[2] On December 7, 2020, Plaintiff filed a request for dismissal with prejudice as to defendants Danny and Jacqueline Rowlett, individually, and as trustees of the Danny and Jacqueline Rowlett Family Trust Dated May 30, 2013, subject to Code of Civil Procedure section 664.6.[3] On February 24, 2021, a notice of stay due to a bankruptcy filing by Plaintiff Kuehne was filed.

RULING: Granted, Unless Proof of Completion of the Deposition Prior to the Hearing

Defendant Henry Paloci moves to compel the deposition of plaintiff Richard Kuehne. Defendant contends service of “seven separate deposition notices,” all met with an objection or representation of an inability to appear due to illness since November 16, 2020. Plaintiff in opposition represents a September 22, 2022 deposition was agreed upon, and requests the court refrain from imposing sanctions. Defendant in reply reiterates the efforts undertaken to take the deposition of Plaintiff, and the continuance of the date to September 28 and now September 29, 2022. Plaintiff requests sanctions in the form of reimbursement of costs for the missed June 13, 2022 deposition, which led to $506 in charges from the court reporter.

A party may file a motion to compel deposition upon a non-appearance of the noticed party. “If, after service of a deposition notice, a party to the action … without having served a valid objection under Section 2025.410 fails to appear for examination, or to proceed with it … the party giving the notice may move for an order compelling the deponent's attendance and testimony…” (Code Civ. Proc., §2025.450, subd. (a).) A party must object to a deposition no less than three calendar days before deposition date. (Code Civ. Proc., §2025.410, subd. (b).)

The motion incorporates a declaration regarding both the necessity of taking Plaintiff’s deposition, and meet and confer efforts to schedule the deposition. [Declaration of Henry Paloci.] (Code Civ. Proc., §2025.450, subd. (b).) The motion therefore complies with all procedural requirements.

Plaintiff concedes to the right of Defendant to take the deposition and represents the ability to now sit for a deposition, with the latest agreed upon date of September 29, 2022. Because the hearing comes after the scheduled deposition date, the court grants the motion only if the deposition has not already taken place. If the deposition took place, the court denies the motion as moot.

If the deposition has not occurred at the time of hearing, the court orders the parties to meet and confer regarding the setting of deposition date within 30 days of this order. The parties may decide on an in-person or remote method, if any party is concerned with Covid exposure. The deposition is to take place within the next 30 days unless the parties agree to an extension of time. If Plaintiff refuses to cooperate in the setting of a date within 30 days of this order, defendant may unilaterally pick a date. If Plaintiff fails to appear for either the agreed upon date or unilaterally selected date, cross-defendant may take a notice of non-appearance and present this as part of a motion for evidentiary, issue or even terminating sanctions against Plaintiff. (Code Civ. Proc., §2025.450, subd. (h).)

The court appreciates the health problems of Plaintiff and accepts the medical records from the treating physician, as a basis for the prior delays. Nevertheless, it appears that Plaintiff only agreed to appear for deposition upon the filing of the motion after several months of delays. The prior attempted deposition, and represented notice of non-appearance on June 13, 2022, can constitute a necessary precursor for a successful motion. The court finds the conduct of counsel reasonable.

The court however denies the request for monetary sanctions to self represented counsel. (Code Civ. Proc., § 2025.450, subd. (g).) (Trope v. Katz (1995) 11 Cal.4th 274, 292; Kravitz v. Superior Court (2001) 91 Cal.App.4th 1015, 1020; Argaman v. Ratan (1999) 73 Cal.App.4th 1173, 1180.) Counsel may however recover costs. Nevertheless, Paloci only identifies the purported court reporter costs in the reply, without any supporting documentation, including even the notice of non-appearance. The court therefore awards the $60 motion filing fee, but declines to award the requested $506 in court reporter fee without documentary proof.

Defendant to give notice.